SAYONA MINING (ASX:SYA) The money is flowing back in battery...

SAYONA MINING (ASX:SYA)

The money is flowing back in battery metals.

US based project developer Piedmont Lithium (ASX: PLL) caught a rocket in September after announcing a deal to supply Tesla with a big chunk of its planned spodumene production for an initial five years.

Now Piedmont is looking to get bigger by becoming a strategic investor and major offtake partner in fellow US lithium play Sayona.

It will ink a +60,000tpa offtake deal based on market pricing (minimum US$500/t, maximum US$900/t), delivered to Piedmont’s planned lithium hydroxide plant in North Carolina.

The current lithium spodumene price is about $US390/t.

Piedmont says the deal will give them more product to sell after Tesla locked up about a third of planned annual production for an initial five years.

Piedmont will also buy 19.9 per cent (a stake which could block any third party takeover attempt) of Sayona for ~$15m .

The cash will help advance Sayona’s flagship Authier project, the emerging Tansim project and creation of a lithium hub in Québec’s Abitibi region, including Sayona’s proposed bid for troubled lithium mine North American Lithium.

NAL managed to produce 114,000t of lithium concentrate in 2018, but low prices forced the company to halt production in February 2019.

“Québec is destined to become one of the world’s major lithium hydroxide production centres given its abundant mineral resources, low‐cost, sustainable hydroelectric power, proximity to major U.S. and European electric vehicle markets, and pro‐electrification stance of provincial leaders,” Piedmont boss Keith Phillips says.

“Sayona’s assets are favourably located in the Val‐d’Or region of central Québec, home to major mining operations and proximate to first‐class infrastructure.

“Sayona’s core Authier project is well‐advanced, with reserves declared and DFS complete, and the nearby Tansim project offers strong exploration potential.

“Furthurmore, Sayona’s pursuit of the brownfield assets of NAL offers a unique regional consolidation opportunity.